ONLINE retailers should be taxed more to save high streets, store bosses have
urged the Treasury.
The chief execs of B&Q and SAINSBURY’S have met with
Treasury Chief Secretary Danny Alexander to discuss the issue in the past
month.
Now a working group is being set up by industry trade body the BRITISH
RETAIL CONSORTIUM to consider ways to change how retailers are taxed.
Ian Cheshire, head of B&Q owner KINGFISHER, said it was barmy that
stores faced crippling rents and rates while online rivals escaped almost
entirely. He said stores simply wanted a level playing field — or more would
go bust. One radical proposal is believed to be a transaction tax on both
store and online retailers.
Mr Cheshire told The Sun: “We have a 19th century tax system for a 21st
century retail economy.
“The increase in rent and rates is squeezing the high street, forcing the
shuttering of shops and leading to higher vacancy rates. For each £1 of
sales, the online guys pay a lot less tax and we need a strategic rethink.
“We are putting together a working group to find a constructive way through
this.
“We don’t want to be simply seen as whingeing. We’re not looking for a free
pass, but a level playing field.”
More than 11 per cent of all UK retail sales are via the internet. But online
groups pay only rent on warehouses while stores face huge rent and rates
bills. Business rates went up 2.6 per cent in April, adding £175million to
firms’ costs.
Vacancy rates have hit record levels as chains such as JESSOPS, HMV
and COMET have collapsed.
Mr Cheshire said ministers had to decide how to levy the same amount of tax —
but spread the pain across both stores and web firms.
He said: “We’ve the most advanced e-commerce market in the world, so we have
the opportunity to be a lab for how you deal with multi-channel retail in
the future.”
Mr Cheshire said the campaign was separate from calls for the likes of GOOGLE
and AMAZON to pay a fair share of corporation tax.
But he said those calls would also be backed by most stores. He added: “I
think I read that Amazon got more in Government grants than they paid in
tax. That seems unsustainable.”